The (industrial) (r)Evolution of Media

The last two posts here were parts one and two of the core idea that drove this blog discussion to begin several years ago. I am passionate about the subject because I know a little about how content has been monetized in the US for many decades but, more important is how this exercise is part of a very basic freedom offered to us as part of being Americans.  I write it for everyone but the story can and will take different turns for different nations as social mood turns everywhere.

Part three in this series gets into the granular picture I see developing for the US. Again, this view was developed by me using what is called aggregate social mood and it comes from learning the socionomic model and adding that to real world experience. It is a pretty straight forward set of ideas that is about a book's worth of new thinking.  In part three of this post I suggest how the digital transaction for content has altered perceptions of value to the extent that the structure of content markets will be altered as social mood corrects in years ahead. This is big picture thinking and is very important to most businesses that use the ad based business model. I do not think anyone appreciates the enormity of th coming changes...kind of like in early 1999 even after broadcast properties and others had drastically consolidated anticipating change following Clinton's 1996 Telecommunications Act but, before the greed went way too far.   I submit that right now is a lot like that time, only different. 

Rather than study part three as a highly specific forecast, try to see the broad suggestions as you might like exiting one highway and merging onto another. What I suggest in the specific diagram can take us (collectively) to many new places and not just one dominant super business/platform which seems to be the misguided goal right now.  Every market can be re-imagined in any number of ways. Put the customer first, really first, and not just saying so, and then there will be many new opportunities to profit. I submit that when enterprises see opportunity lacking, there is either too much competition or the true needs of customers are being ignored somehow. Focus on the customer and not on gaining permanent exclusive access to a narrow channel serving those customers.  That era has already ended. 

Part 3 is posted now over at my trend site, The Root Trend.

 

 

 

 

About-Face - part II (A Basic Structural Change)

This post follows About Face.   It adds detail to the long term shift I suggest is beginning now.  The first post is succinct and includes very condensed ideas.  Whether you know the tech side of enterprises or the media side of the business model you can appreciate that if the gathering social momentum is as pervasive as I suggest, then enterprise turnover will be significant. This is a huge, slow moving trend.  I offer it now so you may watch it develop long enough to convince you to participate.  Large important social trends that involve necessary tools offer profit potential as a way of conveying social importance. This one really matters.   

How could a tested business model based on a long established social contract unravel in a matter of several years? And if I can see it, why aren't others suggesting the same thing? A: Dramatic social change is often very difficult to see even as it approaches.  The socionomic model gives us social mood (to see trending issues) & suggests that entrenched social values are ideas we have (collectively) placed into long term beliefs and do not often scrutinize them.  Social contracts are tested tools and involve the kind of shared values we are more likely to test during larger social corrections (now).   The nature of the transaction for digital content has changed. The application of the advertising business model in the digital environment has changed dramatically and will slowly see consumers question parts of it.  This is a process and not a headline.   Isn't it appropriate that here, at this early high in the information age, we begin to recognize that the detailed information exchange in these transactions needs to be re-examined and maybe re-thought?

In an era when content (supply) has flooded the web, detailed user metrics, never before possible in the realm of old media are being taken for granted. This assumption is misleading and in time will be seen as wrong.  Increasingly,  consumers will see themselves able to address developing concerns.

If it seems like I am blaming the digital industry for doing something bad to consumers seeking digital content, I am not. Here's my main point: I repeat this over and over at The Root Trend.  How we (collectively) value things and ideas of all kinds changes as social mood changes. Socionomics give us a specific lens through which to see trends in societies.  The Choice trend I discuss here is a result of the rise of digital interaction mixing in with the convenient delivery of digital content.  The Choice trend is an extension of a natural human behavior as we aim to settle the digital frontier.  Mixing digital content experiences with Choice has created powerful shifts in demand.  The Choice trend will continue to express itself notably as we (collectively) swing away from recent extremes of the share everything trend that seems to have peaked and is beginning to correct. (think: moving averages of behavior in markets)  So I am clear: Sharing is not about to stop. No way. Never.  The process is about to evolve and become more thought out while reflecting updated social values.

So, if everything I suggest above is happening then how will the next phases begin unfolding in the world of digital content? This is exactly where social mood can help a little.  As social mood turns negative and the social correction proceeds, sharing (as has become typical) will be questioned and scrutinized on many levels. This is another group process where the moving average will shift to the side of sharing somewhat less with fewer people over time.  As part of the same process, the collective "we" will (generally) want to narrow our discourse into smaller groups that are somehow more qualified.  In a lagging manner, parallel to this, businesses will tell us they need the higher quality user data in order to monetize the content experiences.  I am sure politicians will try to regulate this somehow. This is generally when and where I see the fault line that will introduce a change previously held back by a combination of technology and existing market structure:

About-Face

This post organizes and makes current the main trend expressed on this blog over the past few years.

post note: Choice is an obvious general trend that reflects how the
nature of demand for content is changing because of the digital environment
after a very long time, (centuries?), of the opposite expression through
various media. As social shows us, it goes beyond scheduling.  Add the
context of changing social mood and the potential for this trend to impact
commerce broadly and in ways not previously imagined is worth noting. That
stated, what follows is purely my opinion.



Does your business sell advertising to generate revenue?

Is that dynamic creating a conflict with primary customers in order to serve
secondary customers? Who are your primary customers, exactly? Are they
consumers or other businesses?

The time has come to make clear distinctions between customers, their needs
and values, and secondary constituencies.

Why now?

The market dynamic that can be called Choice has taken us here along with
social mood. The long era of broadcast effectively began closing with the
advent of digital networks of connected people. The result, the market
dynamic I call Choice, will now increasingly require a distinction to be
made by enterprises. This would not be necessary in a world without Choice.

Businesses will not change to mirror this overnight but because the nature
of some transactions has changed forever, we are now slowly moving to this
end.

The consistent expression of Choice will be impacted by social mood and
result in changes to commerce requiring many new kinds of specialization.

So, the question is likely: which customer will you decide to face down and
which will you serve by aligning your world view (and actions) with theirs?

The need to ask this question is new because just as the times change, so
does how we value things and ideas of all kinds. Choice will eventually
require a decision by content oriented enterprises (and others too) that
have multiple kinds of customers with conflicting demands. Glossy ideals
about anticipating digital customer's needs better will be re-framed inside
of this new movement. (It may seem early for this larger trend but, it is
morning.)

To truly know your primary customer and to engage them in a manner that
serves you both well, requires trust be established and maintained without
the help of legalese. Choice will, in the changing light of shared social
values, force businesses to make important distinctions.

In coming years markets will demand that enterprises choose which customer
to face. There will be opportunity and limitations in either choice because
this is a fundamental change that will shape other decisions and business
dynamics.

If the choices your enterprise makes puts it at odds with the primary
customers then,

About-Face!

This first era of social reaction in the digital age will be different than
many expect but do not think this is an argument about one kind of company.
The digital ecosystem will interact with changing social perceptions and shared values to force incremental & ongoing specialization upon the entire business model.

further reading suggestion: The Trending Dynamics Re-Shaping the Business of Media

11 20 11 post/blog note: This blog grew out of a category at the trending blog I have written for several years. This post also happens to be the latest post over at that trend blog because it originates using the socionomic trend model.  Over that the other blog I have started a link thread concerning this post...the timing of which seems to have caught a wave of growing sentiment. I will get that thread over here soon but in the meantime you can use this link for The Root Trend.

iroM: Splintering Existing Content Platforms based on Choice

Back on June 23rd I posted a link asking how much does your data cost?  This link from MSNBC is a worthwhile read: Is Your ISP Cheating You Out Of Bandwidth? New Gov't Test Offers Hint

This link/read may seem only tangential to this blog discussion but the very reason this trend toward a new business model is moving slowly is because we have ceded control to platforms that want to control too many dynamics of our engagement with content. The fact is simple: Content platforms can choose to administer the technical side or they can choose to specialize in content curation and community development and management. Cable companies cannot do both. Maybe in another universe they can? In this one they are not smart enough or motivated enough to do it well. They will be pushed aside by more efficient competition eventually and that day is rapidly approaching.

Eventually social mood will get consumers asking about slow download speeds that remain unexplained. They will ask about content bundling they do not want or use. They will demand community management that is offered by new competitors and that will fractionalize the platform potential.   Eventually all our needs will not be packaged for us according to the needs of existing content companies. That has been the entire reason motivating this blog. This is not about frustration of any kind. It is about a market collectively realizing that services are best decentralized and competed in order to point specialization where it will be most needed.  These slow moving social trends are works in progress. Sometimes, however, trends speed up and other times they seem to develop consistently over time.  None of this is because I say so.  If you pay attention, you already see it coming.  Specialization will affect all market competitors in the realm of getting and consuming digital content. Horizontal aggregation is no longer the best way to capture market share even if it seemed that way until recently. Choice is a never ending force in the market. It never rests. The best thing platform owners can do is respect that and not try to justify their limitations.

Speed may seem trivial to many consumers. To others it will be important from time to time or more often. If I get a quart of milk everytime I buy a quart shouldn't I get the average high speed connection when I pay for high speed broadband? The market has not developed in this reagrd because there has not been enough competition to create checks and balances. If this is missing then how many other competitive dynamics are missing? First and foremost, iroM is about Choice. Social Mood is what I call the root trend and it moves both iroM and Choice along a continuum. Change is coming because Choice is taking us there. 

That link above offers another link to a test for your bandwidth. It might surprise you! 

The growing importance of permission and accountability related to our digital data

This started out as a post about changes to a familiar social contract but the key business implications of the discussion suggests how structural change to the industry is likely as part of the longer term fulfillment of Choice.

First, a very basic assumption:

Businesses provide convenient services and products to customers in exchange for consideration.

If and when the value exchanged is perceived to have shifted, due to any kind of change, so too will the agreements made between customer and enterprise.

Pretty simple, right?

Now, the social contract:

The sale of advertising to monetize content consumed by individuals is a very old agreement and, when well organized, creates considerable value. 

In the years and decades before the digital age, this social contract was the basis for a large and growing industry characterized by limited channels of distribution enhancing perceived scarcity.

Finally, a different take on one basic description of the macro operating environment:

It can be shown that at any time we are in a period of either social expansion or social correction. These two very generalized states of social influence change aspects of our operating environment in ways that often affect what we decide are the best ways to operate a business on behalf of the market we intend to serve. 

Conclusion:

Permission & verifiable accountability with digital data are business themes that will increasingly resonate over several years to come and they will be answered by waves of smaller community minded enterprise pioneers who are backed by throngs of digital settlers building new communities based on evolving perceptions of utility. 

How might this impact the media business looking forward?

The big picture of any industry (both present and forward trajectory) can be seen by looking at four sets of variables: fundamentals, the larger trends, market psychology, and the market's structural makeup & status.

 The rest of this post offers light discussion of this theme and will be developed by me here over time.  This will be a new category of posts here to keep track of its development.  The category will be Permission & Accountability and will look at changing demands on the enterprises distributing content.  To some people these issues might appear to be mostly tech oriented but really, to almost everyone under 25, that distinction is irrelevant.  Observation: how utility and legality are very often decided by different demographic groups? In a time of rapid social change this distinction becomes more important. Who's values? And why?